Dr. Jon Elion: The widespread adoption of Risk Adjustment models for healthcare reimbursement can be traced back to the rollout of the Medicare Advantage program (formerly "Medicare Plus Choice") between 2000 and 2007. Reimbursement in this program is based on both inherent characteristics of the patient (demographics such as age, disability, etc.) and Hierarchical Condition Categories derived from [the patients] list of diagnoses in a given eligibility year. There is a numeric level of risk associated with the demographics and with each HCC. These are added together to produce a risk score or Risk Adjustment Factor that is used to adjust payments for the expected expenditures. The RAF and the list of HCCs help create a more holistic view of the patient that has become critical to inpatient and outpatient care reimbursement.

Q: Why is RAF scoring increasingly important in the outpatient space? Why is it crucial for outpatient practices to use it in their clinical documentation?

JE: Historically, healthcare reimbursement was based on fee-for-service, but we are in the middle of a significant transformation to alternative payment models that emphasize quality and outcomes. Most of the new payment models are based on risk ("how sick is the patient?"), so to be able to address and prepare for the shift in reimbursement models means being able to deal with RAF scores. Since the HCCs and RAFs are weighted towards chronic conditions, they are particularly important to consider in the outpatient setting.

Q: How can practices improve RAF score education and better incorporate it into clinical documentation?

JE: Physicians and their office managers should familiarize themselves with the principles behind HCCs and RAF scores. Their growing importance is associated with some new and unique requirements for outpatient documentation. All documentation must be based on a face-to-face encounter, and patients need to be seen at least annually. For each calendar year, the list of diagnoses is reset, so all active conditions need to be re-documented. Each condition needs to be documented as to whether or not it is being monitored, evaluated, assessed or treated (aka MEAT). Conditions need to be documented to the highest level of certainty and specificity at each encounter. These principles can be taught, learned and implemented even without the ability to calculate or track an actual numeric RAF score. The final piece that should be put in place is careful planning before a patient’s first visit of the year, reviewing all of the diagnoses and RAFs from the previous year, determining their MEAT status and planning for careful documentation at the face-to-face visit.

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